Trump signs executive order increasing Buy American thresholds
Federal infrastructure projects could consume more American-made steel with new executive order.
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Trump signs executive order increasing Buy American thresholds

The president has moved to increase the domestic content threshold for American-made iron and steel from 50 percent to 95 percent for federal infrastructure projects.

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July 16, 2019

President Trump signed an executive order, known as “Buy American III,” Monday, July 15, seeking to increase the domestic content threshold for American-made iron and steel in federal procurements. The signing was part of the third annual Made in America Showcase at the White House.

The order is the third pillar in Trump’s Buy American Platform, according to an op-ed by White House trade adviser Peter Navarro for Fox News. It directs the Federal Acquisition Regulatory Council to consider amending regulations that adopted the policies expressed in President Dwight D. Eisenhower’s Executive Order 10582, which declared a product as being American made if at least 50 percent of its components by value are sourced domestically, Navarro says.

With his signing of Buy American III, Trump has moved to increase the domestic content threshold for American-made iron and steel from 50 percent to 95 percent.

Navarro says Trump also recommends raising the domestic content threshold for all other products from 50 percent to 55 percent and is considering raising the threshold to 75 percent in the future.

Navarro’s op-ed details some of the benefits of requiring federal agencies to purchase domestically produced iron and steel for federal projects. “Buy American federal procurement rules provide good manufacturing jobs at good wages, propelling more workers into middle-class prosperity,” he says.

“In addition, about 20 cents of every Buy American dollar tends to come back to the United States Treasury in the form of taxes paid by corporations and workers earning profits and wages on Buy American projects and state and local governments benefitting from more sales tax revenues,” Navarro continues.

Navarro also contends that Buy American strengthens the country’s manufacturing and industrial base “in the interests of both economic and national security.”

“I have seen firsthand across this great nation how stronger Buy American rules, coupled with other Trump actions such as steel and aluminum tariffs, corporate tax cuts to stimulate investment, reduced regulatory burdens and robust workforce development programs are driving a revival in United States steel production and a renaissance in American manufacturing,” he adds.

In response to the signing of this most recent Buy American executive order, Thomas J. Gibson, president and CEO of the Washington-based American Iron and Steel Institute (AISI), released a statement that reads:

“This announcement is another positive step in ensuring the fullest possible implementation and enforcement of existing domestic procurement laws and ensuring the steel industry remains competitive. Strong domestic procurement preferences for federally funded infrastructure projects are vital to the health of the domestic steel industry and have helped create manufacturing jobs and build American infrastructure. We applaud President Trump for once again affirming his commitment to the steel industry that built, and continues to build, our nation.”